Citrus Leisure PLC recorded a revenue increase of over 200% in 1Q FY2016 compared to 1Q FY2015 as Waskaduwa Beach Resort contributed 100 million to the top line, accounting for 62% of total revenue.
Waskaduwa Beach Resort, the largest in the Citrus chain, began commercial operations in June 2014; the addition of its 150 rooms brought the Group's total room inventory to 240.
Despite being new on the tourism landscape, Waskaduwa recorded a satisfactory level of occupancy of 44% while Hikkaduwa achieved an impressive 62% occupancy during the quarter under review which is normally considered the off-season in the tourism calendar.
Gross profit margin improved to 69% in 1Q FY2016 from 67% in 1Q FY2015 largely due to higher GP margin achieved by Waskaduwa at 71%.
The management expects GP margin to further improve in the future with the anticipated higher level of occupancy at Waskaduwa in line with the annual seasonal increase in the expected tourist arrivals.
The room inventory of the group went up to 240 in 1Q FY2016 compared to 90 rooms in 1Q FY2015. Waskaduwa Beach Resort added 150 five star graded rooms to the portfolio.
In June 2015, the group also entered into a management contract to operate The Steuart Hotel in Colombo, a property owned by the George Steuart Group.
The management contract reflected the Group's strong commitment towards the tourism sector by adding another 50 rooms to the portfolio from 2Q FY2016.
The Steuart by Citrus will operate as a boutique business hotel offering the convenience of its prime location.
The management believes that the latest additions to its room inventory position the Group well to cater to the growing tourist arrivals. Citrus Waskaduwa and The Steuart are expected to break even in the near future in line with their growing popularity.
The overall bottom line of the Group has depleted to Rs. 128 mn, primarily due to incremental operational costs incurred by the Group's flagship 5 star hotel in Waskaduwa.
However, the property in Hikkaduwa has shown an approximately 80% increase in bottom line compared to the preceding quarter.
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